Reliance MF To Roll Out New Equity Fund

Reliance MF is all set to roll out a fund that will invest in the S&P CNX Nifty stocks in line with the sectoral composition of the index. The proposed Reliance Equity Advantage Fund, with retail and institutional plans, will aim at long-term capital appreciation by investing at least 70 per cent in equity and equity related securities. The fund's secondary objective is to generate consistent returns by investing in debt and money market securities. Up to 30 per cent may be allocated to debt and money market instruments. An overall limit of 100 per cent of the portfolio value - net assets, including cash - has been introduced for the purpose of equity derivatives in the fund, the offer document filed with SEBI has mentioned.
The fund, which will try to generate additional return by using various hedging techniques, has referred to India's growth model, which promises more "stable, sustainable expansion and bigger returns" for investors. It has also alluded to the possibility of investing in foreign securities. The Nifty, managed by India Index Services and Products Ltd, is made up of 50 stocks taken from 22 sectors. These stocks, according to NSE, represented over 57 per cent of the total market capitalisation as on December 29, 2006.